Independent mortgage bankers posted their highest origination profitability in four years in 2025, though returns remained well below levels seen in most years from 2009 to 2021, the Mortgage Bankers Association found.
Furthermore, the growth in the production segment's financials was largely offset by a drop in net servicing financial income versus 2024.
IMBs and mortgage subsidiaries of chartered banks had an average profit of $785 per loan produced during 2025,
"While profits have improved slightly in recent years, they are still less than half the historical average going back to 2008," said Marina Walsh, the MBA's vice president of industry analysis, in a press release. "There was also wide variability between top and bottom performers due to differences in product mix, volume levels, geography and cost efficiencies, among other factors."
IMB financials for originations in 2025
In its quarterly reports, the MBA found the industry started 2025 by losing money on originations, with the first quarter ending a run where production was a drag on income for 10 of the prior 12 periods.
But
Lenders saw their annual production volume increase, with loan balances at the highest point since the MBA began this study.
But, per-loan production costs did increase year-over-year, Walsh noted, to $11,094 per loan in 2025 compared to $11,076 in 2024. Revenue grew to $11,879 per loan from $11,520 for the same period.
"Historically, when volume picks up, fixed costs are spread over more loans, resulting in a reduction in per-loan costs," she said. "However, that was not the case in 2025 as rising wage growth, increases in third-party charges and reduced application pull-through negatively impacted origination costs."
Servicing profitability declines
Meanwhile, net servicing financial income was $89 per loan in 2025, down from $301 per loan in 2024. The MBA includes net servicing operational income, mortgage servicing right amortization, plus gains and losses on MSR valuations in its calculations.
Between originations and servicing, 78% of the IMBs which participated in this study had pretax financial profits last year, compared with 68% for 2024 and just 36% during 2023.
Having servicing income is important for a significant number of IMBs. Not having this on their balance sheet reduces the share of profitable companies in 2025 to just 64%.
The message for originators: keep a close eye on costs.
"Containing origination costs and increasing efficiencies will remain a differentiator between profitable and unprofitable companies in 2026," Walsh said.
In its fourth quarter Mortgage Performance Report, Boston Consulting Group, which tracks a group of 10 banks and six non-banks, said its client discussions have involved adopting a permanent low-cost structure.
"Companies are busy identifying the last remaining sources of efficiencies as part of a final push to rightsize their cost structure and establish resilient, low-cost platforms," said the BCG report issued in March after the earnings cycle ended. "Our clients are now pivoting to strategies focused on revenue growth, margin expansion, and increased market share."
The competitive advantage for mortgage lenders will be their cost per loan along with efficient customer acquisition — for those companies which get it right, BCG said.
